Private labels have right conditions for high growth

The products bearing private labels of supermarket operators and suppliers are gaining ground for fast growth and are projected to become the next consumer trend in Vietnam in the coming years, said The Nielsen Company Vietnam Ltd.

The quality awareness of private label items among Vietnamese consumers is high, the firm’s managing director, Darin Williams, told the Daily after his presentation at the “What is going on with Vietnamese consumers?” business luncheon in HCMC on Tuesday.

Williams told the event, organized by the European Chamber of Commerce in Vietnam (EuroCham), that up to 73% of consumers surveyed by the market information and measurement firm believed that the quality of private label products was just as good as that of leading brands. But he did not reveal the number of consumers questioned in the survey.

“The perception of quality of private label is pretty high. So the conditions are right for private label to continue growth (in Vietnam),” Williams commented. “So if it follows the growth and development that we have seen in other markets, we expect private label to grow.”

However, Williams said, the growth of private labels in Vietnam would depend on how quickly modern trade grew though he stressed that this new channel had ample room for growth in years to come.

The Nielsen Retail Census 2010 showed the share of modern trade channel was 53% in Malaysia, 46% in Thailand and 43% in Indonesia. But modern trade accounted for only 13% in Vietnam and Williams noted that this percentage did not include some retailers at the time of the study being conducted.

As for major cities, the Nielsen Retail Census indicated the proportion of modern trade was 70% in Bangkok, 66% in Jakarta, 63% in Kuala Lumpur, but only 16% in Hanoi and 37% in HCMC.

That was why The Nielsen Company anticipated significant expansion of modern trade in Vietnam in the future. “We expect modern trade to continue to grow between 15% and 20% over the next two years at least,” Williams said.

The store and supermarket expansion of retailers and wholesalers in this market is also a related contributor to the growth of private label in this market.

The soaring consumer price index, which rose 15.68% in the first eight months of this year from late 2010 and 17.64% over the same period last year, also pushed private label to grow fast in the country. According to The Nielsen, inflationary pressures have generated uncertainty among consumers and made them be more open to change their shopping behavior in those categories registering with the highest price increases.

Due to the high inflation, consumers spend less, reduce the number of visiting shops, look for promotional products, come to grocery stores near their homes to save cost, choose the shops that offer lower prices, buy more Vietnamese goods and trade off the amount by buying bigger packs.

“Consumers are becoming more promotionally driven,” Williams said in his presentation. Therefore, private label products are emerging as one of consumers’ choices as the price of these products is 15-30% lower than those bearing popular brands.

Saigon Co.op, Big C, Metro Cash & Carry and Vinatex currently have various products with their own labels available at their stores nationwide. For instance, the labels of Wow and eBon have been more recognized by local consumers at Big C stores.

Williams said private labels usually started with foodstuffs and any products that did not have strong consumer attachment including sugar, flowers and tissue. However, it almost never begins with toothpaste, shampoo and body lotions because these are “really personal.”
 
Sanofi wants to develop high-tech drug plant in HCMC

The France-based Sanofi Group is looking forward to investing in a high tech pharmaceutical plant in HCMC with larger capacity than its current two plants in the city, said Thomas Kelly, senior vice president of Sanofi Asia.

At the meeting with HCMC Chairman Le Hoang Quan on Tuesday, Kelly proposed the city government facilitate this project, especially in finding a suitable location.

“Both of Sanofi plants in HCMC are located in urban areas. We hope the third one will be developed in an industrial zone with the required area of six hectares,” said Kelly.

Moreover, he added the high tech medicines to be produced in the Vietnam market would be consumed locally as well as exported to other countries. That explained why Sanofi Vietnam had asked for a change in its investment license.

Earlier this month, Sanofi Vietnam submitted to the city government its dossiers, asking for the addition of export-import to the company’s registered business fields. Kelly told Chairman Quan that this change is important to Sanofi Vietnam’s business in coming time because it affects both product export and import of materials that accounts for 90% of production demand.

Along with the export revenue, easier material import would help pull down the medicine prices in Vietnam, Kelly underscored, especially when Vietnam dong is losing its value against strong currencies like the U.S. dollar or the euro.

Regarding the firm’s request to change its investment license, Chairman Quan promised to send his reply prior to September 10, after consulting with the city’s Department of Planning and Investment and Department of Health. In the meantime, the pharmaceutical company was asked to consider the feasibility of the high tech pharmaceutical plant development in HCMC.

Sanofi has been present in Vietnam for nearly 50 years with 1,000 employees currently working at its two plants and offices nationwide. The company last year paid taxes of VND100 billion to the State.

Its offshoot Sanofi – Synthelabo Vietnam is cooperating with the Ministry of Health on a research of vaccine for dengue fever.

However, not until 2015-2016 can this vaccine be put into use, said Kelly, though the Paris-based laboratories are in the final stage of clinical experiment.
 
HCM City’s dong credit growth barely inches up

The total outstanding loans in Vietnam dong at HCMC-based credit institutions are VND522.2 trillion as of end-August, inching up a mere 1.24% against late 2010, said the HCMC branch of the central State Bank of Vietnam.

This agrees with many banks’ opinion that the dong credit cannot grow due to the impact of high interest rate on borrowing demand. The banks are mainly lending to their old clients at present.

Many banks have launched promotion programs to reduce the interest rate burden for their clients, aiming at exporters, and individual and household businesses but the clients still find it hard to access these soft loans.

Meanwhile, as of the end of August, loans in foreign currencies of the banks in HCMC have risen 19.66% over late last year to VND231.2 trillion.

As explained by the central bank and experts, the big difference between interest rates in Vietnam dong and the U.S. dollar made borrowers prefer foreign currencies over dong. The current U.S. dollar lending rate is 6-8% a year but that of Vietnam dong is as much as 20%.

Overall, the total outstanding loans of the city banks are VND753.4 trillion as of end-August, or 6.26% higher than at the end of 2010.

The difference between interest rates in Vietnam dong and the dollar has also resulted in the opposite directions of the banks’ mobilizing and lending activities. Whereas foreign currency lending prevails over the national currency, mobilization of foreign currencies is on the downtrend compared to that of Vietnam dong.

Currently, the annual deposit interest rate for the greenback is capped by the central bank at 2% for individuals and 0.5% for businesses. On the other hand, clients are enjoying the dong deposit rate at 14%, which can surge to 18-19% with big deposits upon negotiation.

The State Bank of Vietnam has lately committed to keep the foreign exchange rate from fluctuating within 1%, prompting many people to switch to Vietnam dong deposits.

According to the report of the central bank’s HCMC branch, the total mobilization of credit institutions is VND857.7 trillion as of end-August, up by 6.38% against late 2010. Mobilization in Vietnam dong has reached VND657.8 trillion, or a rise of 8.89% over late last year, while mobilization in foreign currencies is VND199.9 trillion, dwindling by 1.12%.

In the short term, the fall in foreign currency deposits versus a rise in foreign currency lending would pressure not only the forex rate, but also the balance of foreign capital ratio and the loans in foreign money.

Therefore, the central bank has decided to raise the foreign reserve requirements by one percentage point and informed it would inspect the foreign currency credit growth at credit institutions.
 
Cau Gie-Ninh Binh Highway to be completed next year

The construction of the Cau Gie-Ninh Binh Highway needed to be sped up to be completed next year, said Deputy Prime Minister Hoang Trung Hai.

Hai asked that capital be allocated so the highway's first section linking with Cham Thi Bridge could be opened for traffic in the third quarter.

The Ministry of Planning and Investment was assigned to co-ordinate with the Ministry of Finance to seek investment to connect the first section to National Highway 21.

The two ministries would submit plans of land clearance in Ha Noi, northern Ha Nam, Nam Dinh and Ninh Binh provinces for the construction.

The six-lane highway covers 50.3km from National Highway 1A in Ha Noi to National Highway 10 in Nam Dinh Province. It will have a speed limit of 100-120kph. In the first phase, the project will have four lanes with 13 bridges and nines intersections.

The project has disbursed 88 per cent of capital investment and completed 81 per cent of the work.

The Ministry of Finance issued bonds worth VND2.4 trillion (US$115 million).

The project started in early 2006 at an initial cost of VND5.4 trillion ($260 million), sourced from the issuance of bonds under the Government guarantee.

The cost increased to VND8.9 trillion ($428 million) due to price fluctuations and other problems.

Local goods fall to Chinese imports
 
Vietnamese producers had lost control of their domestic market to Chinese competitors, a conference was told here yesterday.

This had resulted in the weak presence of locally-made goods in big distribution chains carrying 80 per cent of supplies nationwide.

Only 10 per cent of fine arts and souvenir goods and 30 per cent of consumer goods available in Dong Xuan Market and other major wholesalers throughout the country are locally made.

The remainder of the goods were from China, said Do Xuan Thuy, general director of Dong Xuan Joint Stock Co, the market's investor.

Vietnamese goods had also failed to effectively dominate in many other traditional markets, said Thuy.

He blamed the poor performance on the weak competitiveness of Vietnamese goods and local firms' interests in fostering exports rather than developing local distribution channels.

Meanwhile, most of the cheap Chinese goods that dominate Vietnamese markets are imported in small volumes through border gates with lower import tax.

Flexible payment systems and good delivery services also keep the door open for Chinese goods.

Thuy said small businesses in the marketplace voluntarily display Chinese products in favourable positions for which the suppliers did not spend a penny in fees.

Retailers of household goods at the conference said they wanted to sell locally-made goods because the trading of imported goods without proper certificates of origin was risky.

But Nguyen Khac Dung, a household-goods storeholder at Dong Xuan Market, said it was difficult for individual businesses to sign contracts with popular Vietnamese enterprises.

"As individual businesses, we do not have legal power to sign contracts with Vietnamese businesses," Dung said.

Nguyen Thi Huong, a children's wear seller, gave another reason for the low competitiveness of Vietnamese goods. She said they were more expensive than those from other countries.

As most consumers are now paying more attention to prices because of inflation, Huong suggested local producers offer consumers more acceptable prices.

Domestic manufacturers should review their production and marketing capacities to better sharpen their competition, said Viet Nam Retailers' Association chairman Phan The Rue.

He said companies should also foster the use of local raw materials because if they continued to depend on imports as at present, they would fail to compete with foreign products.

He also called for effective prevention from State authorities to curb smuggling of foreign goods into the country.

Cement plan gets thumbs up

The Prime Minister this week approved a strategy to develop the country's cement industry until 2020, requiring the industry to immediately apply advanced and low energy consumption technologies to save materials and protect the environment.

Accordingly, the cement industry would have to complete the conversion from its current out-of-date shaft kilns to modern rotary kilns by the end of 2015.

New cement production projects licensed since Monday with a design capacity of more than 2,500 tonnes of clinker per day must invest in systems to utilise discharged heat for power generation.

Projects that received licences before Monday should have the equivalent systems in place before 2015.

The strategy also states that the Government would also offer incentive policies to encourage cement production projects with a design capacity of less than 2,500 tonnes of clinker per day to construct similar systems.

Besides giving priority to projects based in areas rich in materials with good transport infrastructure, the Government would also help facilitate new cement projects in the southern provinces where there is a rising demand for cement.

The Government forecast that cement demand in the domestic market would be 54-55 million tonnes this year. That figures would surge to 75-76 million tonnes by 2015 and 93-95 million tonnes by 2020, before reaching a whopping 113-115 million tonnes by 2030.

The strategy estimated the country would need an additional 32 new cement projects from 2011-15 to meet the rising demand for cement.

Rubber thread factory opens

The Dak Lak Rubber Thread Company (Dakruthread) has officially opened its new rubber thread factory in Hoa Phu Industrial Park, in the central highlands province of Dak Lak.

Total investment in the factory has reached VND170 billion (US$8.6 million), and it is equipped with modern machinery with a capacity to produce 4,000 tonnes per year.

The factory will provide products for the international and domestic garment industry and will minimise imported items from Thailand and Malaysia.

Fewer property loans outstanding

Outstanding loans in HCM City's real estate sector reached VND89.5 trillion (US$4.3 billion) and account for 11.96 per cent of total outstanding loans - a decrease of 8.8 per cent from last year.

Outstanding loans for infrastructure construction reached VND14.6 trillion (US$708.7 million), accounting for 16.36 per cent of total outstanding loans in the real estate sector. Debts for industrial and export processing zones stand at nearly VND2.4 trillion.

Real estate bad debt accounts for 3.8 per cent of total outstanding loans for the sector, in which joint stock commercial banks hit the highest levels of bad debt at 2.61 per cent of total outstanding loans in the real estate sector.

Bank to increase charter capital

The State Bank of Viet Nam has permitted the Tin Nghia Bank to increase its charter capital from VND3.39 trillion (US$164 million) to VND4.58 trillion ($220 million).

The capital increase was approved during a shareholder meeting in April this year by the Tin Nghia Bank, which will have a wider range of responsibilities under the deal.

The bank will now implement all of its legal procedures, information processes and reports related to the increase of charter capital, which are stipulated in current regulations, which extend to shareholders of the bank.

Push for foreign currency rules

The central bank governor has pushed for regulation of foreign currency trading for individuals and licensed organisation in circular 20/2011/TT-NHNN.

Foreign currency purchasing by Vietnamese individuals is limited to $100 per person, per day, or the equivalent for other currencies.

The limit also applies to children sharing a parent's passport, but credit institutions will be allowed to exceed the limit to balance foreign currency reserves.

Private helicopter service opens

Viet Nam Air Service Company (VASCO) under Viet Nam Airlines Corporation will co-operate with the Azur Helicopter Company (AHC) of France and the Vinacopter Company to open Viet Nam's first private helicopter service.

The charter service is expected to be operational by the end of October, using the Eurocopter AS350 B2, which can transport four passengers.

Flights will depart from Tan Son Nhat International Airport in HCM City to popular sites in the southern provinces.

According to Jussi Hoika, Commercial Director of Vinacopter, apart from transporting passengers, the helicopter is also suitable for aerial photography.

Binh Duong lures over $14b in FDI

The southern province of Binh Duong has attracted over US$14 billion through more than 2,000 foreign direct investment (FDI) projects in the first eight months of this year, the provincial People's Committee announced.

Seventy per cent of the total investment has been disbursed, boosting and stabilising the province's industrial sector, according to Vice Chairman of the provincial People's Committee Tran Thanh Liem.

By the end of August, 46 projects were licensed with a total registered capital of $250 million and 65 operating projects poured in an additional $220 million.

Firms refuse to pass on fuel savings

Transport operators are unwilling to cut fares despite the slight drop in fuel prices, saying it can not compensate for other costs that have risen sharply.

Last Friday petrol prices dipped by VND500 per litre and the diesel price by VND300, a 2.3 per cent and 1.4 per cent fall respectively.

Ta Long Hy, chairman of the HCM City Taxi Association, said most taxi companies were not willing to reduce fares.

The cut in fuel prices was too low to reduce fares, he said.

Besides, to change the fares they had to spend a significant amount of money to recalibrate the meters, he said. Around 10,000 taxis operate in HCM City.

Do Quoc Binh, the chairman of the Ha Noi Taxi Association, said taxi firms would not lower fares unless petrol prices fell by at least VND1,000.

The cost of altering the meters and other expenses could top VND100 million (US$4,800), he added.

Thuong Thanh Hai, deputy director of the Mien Dong (Eastern) Bus Station in HCM City, said fares would not be lowered since the drop did not make up for other rapidly-increasing costs the bus companies had already incurred.

When petrol prices rose, most bus companies were reluctant to increase fares, but when they fell, they always wanted to reduce fares to compete with their rivals, he revealed.

The HCM City Cargo Transport Association made it clear that cargo rates would remain unchanged.

Luong Hoang Trung, deputy chairman of the association, said the fall in the diesel price could not make up other costs like tyres, components, and labour, which had all risen sharply.

Rates could only be lowered if fuel prices fell by 7 – 10 per cent, he claimed.

Earlier fuel prices went up twice this year.

On February 24 petrol prices rose by VND2,900 per litre to VND19,300, and diesel by VND3,550 to VND18,300.

On March 29 petrol was up by VND2,000 and diesel by VND2,800.

Banks get nod to lend up to 80% on deposits

Commercial banks may lend over 80 per cent of their deposits, under a new circular issued by the State Bank of Viet Nam. The new regulation would also allow non-bank credit institutions to lend up to 85 per cent of their deposits.

Circular No 22/2011/TT-NHNN aims to reform regulations on capital adequacy ratios (CAR) included in last year's Circular No 13. The old regulation had triggered a number of concerns from banks and experts over whether it required too much money to be held idle in provision against risk.

The new circular, lightening the restrictions on bank deposits, was issued following a meeting last week between the State Bank and representatives of 12 major commercial banks, held in an effort to bring lending interest rates to within an average of 17 – 19 per cent per year this month as promised by newly-appointed State Bank Governor Nguyen Van Binh.

The new circular was expected to help banks circulate more funds on the interbank market and increase overall returns on capital, while limiting overall credit growth for the year to 20 per cent or less.

Other regulations aimed at boosting commercial banks' ability to make use of idle capital – including new credit limits for specific customer groups, new rules on classification of equity, and new reserves ratios – would follow in the wake of Circular No 13, the State Bank said.

Japan assists support-industry firms

Small and medium-sized enterprises operating in the support industry will receive free technical support from retired Japanese professionals under a five-year ODA-funded project.

SMEs operating in the auto, motorbike and electricity sectors as well as electronics and machinery manufacturing are eligible to receive technical support for five to six consecutive months. The aim is to help them improve productivity and quality.

The Japan International Co-operation Agency (JICA) and the Viet Nam Chamber of Commerce and Industry implement the project, which began in 2009.

Nguyen Duc Binh, director of the SME Promotion Centre under the Viet Nam Chamber of Commerce and Industry (VCCI) -HCM City branch, said the project had sent senior volunteers with rich experience in various industrial sectors to help SMEs in HCM City and three provinces in the south, including Long An, Dong Nai and Binh Duong.

The project aims to assist Vietnamese SMEs to increase competitive capacity by improving product quality, prices and delivery times, Binh said at a conference yesterday in HCM City.

Le Anh Tuan, deputy head of HCM City Export Processing and Industrial Zones Authority, said the support industry in Viet Nam was still weak, hindering investment promotion and competitive capacity of Vietnamese enterprises.

An under-developed support industry also limits value-added exports and increases the trade deficit, he added.

He said that SMEs in industrial parks and export processing zones taking part in the project could improve their competitive capacity and contribute to the development of the local support industry.

A total of 88 SMEs have been visited and interviewe; 32 received technical support.

Watchdog issues margin-trading guidline

The State Securities Commission issued its long-awaited margin trading guidlines on Tuesday, regulations which will officially enable brokerages to begin offering this service to investors.

Under the new regulations, investors must deposit at least 60 per cent of the total amount that they are initially borrowing from the brokerage, or a minimum of VND10 million (US$480), and they must maintain a margin rate of no less than 40 per cent during the loan period.

In principle, a share is tradeable on margin it it has been listed for at least six months, the firm has no accumulated losses, and the listing has not been suspended. Securities firms must disclose the list of eligible shares to investors.

An Phat Securities Co general director Tran Thien Ha said the new regulations were clearer and easier to apply than those in a previously circulated draft. In particular, it now made all securities companies, except those under regulatory control or subject to licence revocation, eligible to provide the service if they satisfy technical infrastructure and staffing requirements.

"Approval of margin trading will not only improve market volume, which is essential in the current context of a prolonged downtrend, but also help increase the financial transparency of securities companies," Ha said.

Brokerage houses must ensure a financial safety ratio (a ratio of total usable capital over total liabilities) of no less than 150 per cent for three consecutive months before providing the margin trading service, as well as a debt over equity ratio of no more than six times and accumulated losses equal to no more than 50 per cent of charter capital. Securities firms will not be able to lend over 200 per cent of their equity, and their lending to a single investor will not be able to exceed 3 per cent of their equity. They will also not be able to extend an amount on margin in excess of 10 per cent of their equity on a single stock.

According to the recent data compiled from 98 brokerages by the financial website vietstock.vn, an additional VND67.5 trillion ($3.25 billion) could be injected into the stock market once securities firms begin offering the margin service.

KF named lead leasing, marketing agent for Imperia An Phu

Knight Frank Vietnam and Inveskia - a joint venture partnership between Prudential Vietnam Property Fund, Kien A and Invesco Co - have officially announced the collaboration of lead leasing and marketing agent at Imperia An Phu in HCMC’s District 2.

Knight Frank will represent the developer to sale the retail space to investors or owner occupiers.
Located in An Phu Ward, Imperia An Phu is part of the 87 hectare City Horse project, adjacent to a 7 Hectare Green Park and within close vicinity to developments such as The Vista, Estella, Cantavil, Rach Chiec golf driving range, and numerous international schools.

Imperia An Phu will offer investors the opportunity to purchase up to 4,230 square meters of retail space with supermarket, restaurants, beauty salon, kindergarten, private school, clinic, fitness club, spa and sauna.

“The retail component of Imperia offers the investor a rare opportunity to buy commercial property in a good quality development with strong potential for attractive returns and capital growth in one of the most desirable and up and coming areas in HCMC,” said Stephen Wyatt, Director of Retail Services.

Vietnam spends $3.13 bln on foreign aids repayment

Vietnam has spent some VND65.15 trillion ($3.13 billion) on the repayment of debts from foreign aids in the first 8 months of this year, meeting 75.8 percent of the year's estimate, said the Ministry of Finance.

Some VND7.1 trillion was repaid in August alone, down 10 percent month on month, said the ministry.

In August, the total state budget expenditure was estimated at VND56,505 trillion, bringing the total figure in Jan-August to VND480,895 trillion, 66.3 percent of the year's estimate.

The spending on development investment was VND100.62 trillion, 66.2 percent of the year's estimate.

Among the expenditure, the state budget spent up to 75.6 percent of the estimate on compensation for preferential credit interest rate difference, 73.9 percent of the estimate on supporting the national reserve and 63.6 percent of the estimate on supporting capital for public enterprises.

Regarding spending on the basic construction investment, till the end of August, the state budget advanced some VND95.5 trillion for projects, or 65.7 percent of the year's estimate and the actually disbursed capital for investors reached 63 percent of the year's estimate, equaling to the figure of the same period last year.

Also till the end of August, capital disbursement from G-bonds reached over 80 percent of the year's estimate.

The disbursement from G-bonds for irrigation-transport and hospital upgrading projects were estimated to reach 83.7 percent and 72.8 percent of the year's estimate.

Spending on socioeconomic development, defense, security and administration management, including expenditures for salary reform, reached VND315.125 trillion, or 67.2 percent of the year's estimate, in January-August.

In detail, spending on defense and security reached 67.4 percent of the year's estimate, spending on education and training activities reached 66.9 percent and spending on retirement pensions and social security reached 74.5 percent.

Market buzzes with commercial center transfer

Offices for lease and commercial and retail centers are usually leased out by property project developers, but the real estate market is seeing more project owners selling these spaces, wholly or partially, to their partners.

Property consultant firm Knight Frank Vietnam said it had just signed a cooperation contract with Inveskia Co., a joint venture between Prudential Vietnam Fund Management,
Kien A and Invesco companies.

Under this contract, Inveskia will be a marketing and offering agency for the commercial area of the Imperia An Phu building in Ho Chi Minh City’s District 2.

Stephen Wyatt, director of retail service division at Knight Frank, said the Imperia An Phu project would offer investors as much as 4,200 square meters of retail space, including a supermarket, a wedding hall, a private school, and a healthcare center.

The project is developed on a two-hectare site and consists of four blocks of 24-28 storey buildings with some 700 apartments and a retail section. The total investment for this project is US$130 million.

Also at the Cat Lai T-junction area, The Vista project of Singaporean property developer CapitaLand is under progress for completion after offering its products to the market in 2007.

This project includes two blocks of buildings with about 850 commercial and serviced apartments, as well as retail and office spaces.

According to an unofficial source, CapitaLand has transferred the office building, serviced apartment and commercial center segments with a total area of 5,700 square meters to its partner.

Earlier, VinaCapital Real Estate Company chose property service provider Cushman & Wakefield as a broker to offer each floor or the entire Metroplex office building project in the Phu My Hung urban area in District 7.

Some experts said the offer of partial office and retail spaces provided investors with opportunities to purchase and possess commercial real estate instead of renting. The acquisition of partial office buildings is popular in many countries but still unfamiliar to the Vietnamese market.

However, from another angle, experts saw a shortage of capital in the property market driving investors to seek new financial sources.

Along with selling a complete project, offering a partial project is a new approach to capital mobilization for the construction of their other projects.

Regarding office and retail area businesses, market observers said the average price of the HCMC-based offices for lease has continued to fall for ten consecutive quarters.

In particular, rental prices dwindled to US$36 per square meter in grade-A offices and US$22.5 in grade-B ones.

Current market difficulties are forcing property project owners to launch preferential policies in order to attract new tenants as well as enforce their bonds with old customers.

Meanwhile, the retail market saw no new supply for lease in the city’s central area in the past two quarters to add to the available 353,000 square meters.

According to CB Richard Ellis (CBRE), the average rental price of commercial centers is US$109 a square meter, rising by 6% compared to the beginning of the year.

The price is US$33 per square meter for projects outside the downtown area.

Owners of these projects, due to location disadvantages, are offering competitive prices to attract more tenants.

PV